𝐔𝐧𝐝𝐞𝐫𝐬𝐭𝐚𝐧𝐝𝐢𝐧𝐠 𝐭𝐡𝐞 𝐀𝐩𝐩𝐫𝐚𝐢𝐬𝐚𝐥 𝐏𝐫𝐨𝐜𝐞𝐬𝐬: 𝐖𝐡𝐚𝐭 𝐇𝐨𝐦𝐞 𝐁𝐮𝐲𝐞𝐫𝐬 𝐚𝐧𝐝 𝐇𝐨𝐦𝐞𝐨𝐰𝐧𝐞𝐫𝐬 𝐍𝐞𝐞𝐝 𝐭𝐨 𝐊𝐧𝐨𝐰

Whether you’re buying a new home, refinancing your mortgage, or selling your property, one key aspect of the process you’ll encounter is the property appraisal. As an appraisal company, we want to help you understand how the appraisal is used to determine your property’s value and how it impacts your home loan process. Understanding this process can help you navigate the mortgage journey with more confidence and clarity.

𝐖𝐡𝐲 𝐃𝐨 𝐋𝐞𝐧𝐝𝐞𝐫𝐬 𝐔𝐬𝐞 𝐀𝐩𝐩𝐫𝐚𝐢𝐬𝐚𝐥𝐬?

When you're securing a loan—whether it's for purchasing a new home, refinancing, or taking out a home equity loan—your lender will require an appraisal. The appraisal helps the lender assess your property’s value to ensure its adequate collateral for the loan. The value determined by the appraisal plays a role in many aspects of the loan process, including your interest rate, the amount of your required down payment, and whether or not your loan will be approved.

𝐓𝐡𝐞 𝐑𝐨𝐥𝐞 𝐨𝐟 𝐭𝐡𝐞 𝐀𝐩𝐩𝐫𝐚𝐢𝐬𝐚𝐥 𝐢𝐧 𝐘𝐨𝐮𝐫 𝐋𝐨𝐚𝐧 𝐏𝐫𝐨𝐜𝐞𝐬𝐬

Once an appraisal is ordered, it provides an unbiased estimate of your property’s market value. In most cases, the lender arranges for the appraisal, and the cost is included as part of your loan fees. If there’s an issue with the appraisal value—whether it’s too low or too high—it can have a direct impact on the amount of loan you qualify for or the equity available in your property.

𝐖𝐡𝐚𝐭 𝐭𝐨 𝐃𝐨 𝐈𝐟 𝐘𝐨𝐮 𝐒𝐮𝐬𝐩𝐞𝐜𝐭 𝐘𝐨𝐮𝐫 𝐀𝐩𝐩𝐫𝐚𝐢𝐬𝐚𝐥 𝐢𝐬 𝐈𝐧𝐚𝐜𝐜𝐮𝐫𝐚𝐭𝐞

Once the appraisal is completed, if the valuation doesn’t match your expectations or seems off, it’s important to take action.

H͟e͟r͟e͟’͟s͟ ͟h͟o͟w͟ ͟y͟o͟u͟ ͟c͟a͟n͟ ͟p͟r͟e͟p͟a͟r͟e͟ :͟

⒈ 𝐴𝑠𝑘 𝑌𝑜𝑢𝑟 𝐿𝑒𝑛𝑑𝑒𝑟 𝐴𝑏𝑜𝑢𝑡 𝑎 𝑅𝑒𝑐𝑜𝑛𝑠𝑖𝑑𝑒𝑟𝑎𝑡𝑖𝑜𝑛 𝑜𝑓 𝑉𝑎𝑙𝑢𝑒

Early in your loan process, ask your lender if they have a procedure for reviewing an appraisal—this is known as a "reconsideration of value." If you have information that might affect the valuation (such as more comparable sales, updated home features, or corrections to errors in the report), this process allows the lender to re-evaluate the initial appraisal.

2. 𝐶𝑎𝑟𝑒𝑓𝑢𝑙𝑙𝑦 𝑅𝑒𝑣𝑖𝑒𝑤 𝑡ℎ𝑒 𝐴𝑝𝑝𝑟𝑎𝑖𝑠𝑎𝑙 𝑅𝑒𝑝𝑜𝑟𝑡

Once you receive the appraisal, review it in detail. Look for potential errors—anything from inaccurate square footage, missing upgrades or improvements, or the use of incorrect comparable sales. If you find discrepancies, gather supporting information, such as:

• A plat map or survey to confirm the correct lot size

• Measurements or blueprints to correct square footage

• Photos or receipts of recent home improvements or upgrades

• A list of nearby comparable properties that have recently sold for a higher price

3. 𝑆𝑢𝑏𝑚𝑖𝑡 𝑌𝑜𝑢𝑟 𝐹𝑖𝑛𝑑𝑖𝑛𝑔𝑠 𝑡𝑜 𝑌𝑜𝑢𝑟 𝐿𝑒𝑛𝑑𝑒𝑟

If you believe there’s an error in the appraisal, gather factual evidence to support your case. For example, if the square footage is miscalculated, provide your own measurements or a recent survey. If the comparables used seem out of date or inaccurate, provide a list of recently sold homes in your neighborhood that better match your property. Present this information to your lender, and they can request a review or reconsideration of the value.

𝐖𝐡𝐲 𝐔𝐧𝐝𝐞𝐫𝐬𝐭𝐚𝐧𝐝𝐢𝐧𝐠 𝐭𝐡𝐞 𝐀𝐩𝐩𝐫𝐚𝐢𝐬𝐚𝐥 𝐏𝐫𝐨𝐜𝐞𝐬𝐬 𝐌𝐚𝐭𝐭𝐞𝐫𝐬

Navigating the loan and appraisal process can sometimes feel overwhelming, but having a solid understanding of how appraisals work can make a significant difference. An accurate appraisal ensures you're getting a fair assessment of your property’s worth, which affects everything from your loan approval to your financial future.

If you ever feel uncertain about an appraisal’s findings or have questions about the process, don’t hesitate to reach out to a professional appraiser. An experienced appraiser can provide valuable insights and help guide you through the steps to ensure your appraisal reflects the true value of your property.

Reach out to Legends Valuation Services today for assistance with your appraisal needs.